Shhhhh...diam diam collect .. It has 60mil++ cash .. It's one of the few Net cash company..a gem... It's a bargain just like focus lumber last time when it was at around 1.30++ .. finally it moved, it also appears in insider Asia featured stock & someone wrote on this earlier..
"On 24th July 1986, it changed to its present name of Hexza Corporation Berhad." 2016, 30th anniversary. Something great might happen soon, special dividend+bonus+$$$come, hopefully! Hahaha...
np dropped mainly due to higher raw mat cost. Another thing, they spent more than 23mil on "available for sales investment"? can any sifu shed some light on this?
well basically there is not much of a concern. It's still a net cash company with zero debt, and lots of cash and "Other investment". 1. Raw material is little impact is around $1.4m to their profit- due to USD vs RM. RM recently could be seeing some strengthening after the 1mdb issue is "resolve". This could also be a "risk" in 2016 for those companies previously "benefited" from the strong dollar may see their share price goes down, once RM gets stronger. You can see that the glove companies stocks going down. 2.RM$23 mil although not mentioned which are the shares it invest in-this refers to investment in shares or quoted securities in malaysia(base on their annual report under "Other investment"). Usually companies which has a lot of cash can invest in shares which may yield higher returns in long run, rather than put in bank or FD. Note that this has no impact to their NTA, and they can also sell anytime (liquid), unless of course if the value of their investment drop. 3.There is a pending land sales which could be completed this year which shld net around $17mil. 4.As of now the company still have RM 37 mil in cash, ~$63mil ($40mil+$23mil) in quoted securities and zero debt . Once the land sale is completed they shld have liquid cash and investments of around RM 37mil+$63M+$17M= $117M.
There were a few reasons I think for drop in profits 1. The manufacturing division operating margins fell from 11.5% to 7.4% y-o-y. Management already indicated in Q2-2015 last year that the good margins were one off as they were able to secure raw material at favorable rates then. The current margin of 7% is consistent with the previous 2 quarters 2. Losses of RM 1.36 mil from impairment and forex negated the income that came from the leaseback agreement.
My estimates for 2016 roughly as follows EBIT (manufacturing) = RM 10.6 mil EBIT (Leaseback) = RM 6.56 mil Total EBIT = RM 17.2 mil
The above number is roughly the same as what the group achieved in 2015. Upward revisions may come from favorable raw material prices further improving margins (due to low crude oil) and/or special dividends once the disposal of Norsechem Resins is completed.
profits made in previous years, and yet to be distributed to shareholders via dividends, special dividends, capital repayment, or bonus. take a closer look at it, something good might happened very soon, 3-6 months. don't believe? time will prove. come back to this on Nov/Dec. Don't want to say too much now.
PBT 2015 =19,358,000 . 2016(half a year PBT)=12,919,000 Basic Earning per share in 2015=7.0 sen Basic Earning per share 2016(Half yearly only)=5.3 sen.
The 2016 Q3 EPS is only 0.6 cents, 50% dropped YoY from 2015 Q3 1.2 cents. The main reason is because of the one time reversal of foreign gain of 2.51M otherwise the company should have reported EPS of around 1.9 cents.
The company is super cash rich until they have to invest the cash into others type of short term investment which generate 1.83M of dividend so far in 2016. The cash/share alone is 0.67 cents (cash balance + all investment) which means investor only pay 21 cents for the entire business. Overall the business is still generating profit.
On top of it there is 10.3M asset held for sale in the current asset or about 5 cents EPS which I think will be reflected in the next Q report once the sales is materialize. Please correct my assumption here if you think it is not correct.
Who the sohai eat the share till 0.935? Timing not right, slowly lah. I expect it will only move next month, still have time to buy more at cheaper price lah. Don't move so fast!
People see it's undervalued and don't mind to buy some at higher price. and you called "sohai". you're so rude! You wait lah, and see who the sohai is. Excuse me.
Why so quiet? Buyers wait sellers, sellers wait buyers. hahaha!!! Copy and paste the following from The Edge for reference.
"Hexza offers investors an above-average yield of 5% and potentially higher dividends ahead as the company uses its huge cash pile to acquire earnings-accretive assets. Hexza has a debt-free balance sheet with net cash of RM51.4 million and investments in financial assets of RM63.7 million, which are equivalent to almost two-thirds of its market capitalisation.
Besides investment holding, Hexza is involved in the manufacture of formaldehyde-based resins and ethanol — industrial chemical products used extensively in different local industries, such as furniture, construction and infrastructure. With its manufacturing division riding an earnings recovery trend in recent years, its share price has gained 54.3% to 89.5 sen from 58 sen in 2011.
In FY2016, revenue declined 6% y-o-y to RM141.4 million, attributable to the cessation of a subsidiary’s operations in August last year. However, net profit was up 14% to RM16 million, thanks to the commencement of finance lease income flow.
Recall that Hexza entered into a sales, purchase and lease agreement to purchase an 8mw heavy fuel oil power generation system in Myanmar from Singapore-based Tembusu for US$6 million. The finance lease’s internal rate of return is estimated at 22% and it started contributing to the company’s earnings in FY2016 and will do so for the next 10 years."
bugle, thank you for writing a great article on HEXZA! Excellent analysis with figures and facts. But, like I said, the timing is not so right lah. Anyway, appreciate your efforts, well done!
Yes, you know, I know. More than 4.5% dividend yield! But there are still a lots don't know about it. Don't push 1st! i'm still collecting. The lower the better. Anyway, I'm just a small shareholder at the moment.
Of the chemical industries, the share price of NYLEX is moving, SAMCHEM is doing well, LUXCHEM's price is more than double of its NTA. WHEN is your turn?!!!
Yes, u r right! Again, of the chemical industries, the share price of NYLEX is moving, SAMCHEM is doing pretty well, LUXCHEM's price is more than double of its NTA. WHEN is your turn?!!!
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
lkee168
26 posts
Posted by lkee168 > 2016-01-06 14:56 | Report Abuse
Start to move toward rm1,,,,,